Hi Matt - WELCOME to YT
! Glad you found us. My Wylie went through LP a little over a year ago and does just amazing - you'd never know he had the surgery. Knock on wood.
As far as age - I'd let your vets / specialists guide you in that matter - I can't really speak to whether it'd be best to wait or not. You generally don't want to wait toooo long when it's a Grade 3 that also has symptoms, but again, I'd speak at length w/ your vets about this aspect.
As far as separation, we have 2 other yorkies and we didn't keep them separated at all. Wylie was encouraged to be mobile and walk around - just no fetching / fast running etc for a good while. So, you may not have to keep them separated, it may just be a matter of figuring out how to avoid running for a while.
For what to ask the vet, I'd ask about the recovery - get a really clear picture of what's to be expected both the first several days (very different than later) vs after that. Also, will you be doing BOTH knees or just one? We did both Wylie's knees at one time, and I'm so glad I went that route vs 1 at a time. Ask perhaps what happens if the surgery doesn't go well afterward, what would revisions cost if needed. Ask about chances of arthritis so you're clear on that front. Make sure there is a good pain management plan for afterward -- especially including what is the plan after hours if pain is NOT being managed - what should you do then (most vets will tell you how you should increase the dose properly if meds aren't working at current dose).
I hope it goes well for your kiddo - and please keep us posted!